The mortgage and actual property trade is not any stranger to disruptors, particularly over the previous few years as scores of corporations have tried to alter the best way we purchase, promote, and acquire a house mortgage.
One of many newest examples is “Tomo Mortgage” a venture-backed fintech with some big-name founders and traders, together with former Zillow staff Greg Schwartz, Carey Armstrong, and Spencer Rascoff.
What’s distinctive about this mortgage lender is that they solely originate house buy loans. No refis. Meaning they’re utterly dedicated to house consumers.
Like different lenders, they’re trying to stage the taking part in discipline between money consumers and people who want a mortgage, an particularly related concern in at the moment’s ultra-competitive housing market.
Tomo Mortgage Is a Buy-Solely Lender (No Refis)
- Direct-to-consumer, buy loan-only mortgage lender
- Based in 2020, headquartered in New York Metropolis
- At present employs about 85 individuals
- Began by former Zillow executives Greg Schwartz and Carey Armstrong
- Do NOT cost lender charges and provide each a low charge and shutting assure
- May even pair you with an actual property agent for a further mortgage charge low cost
- Say they provide mortgage charges 0.5% beneath everybody and as much as 1% beneath the large guys
- Named Finest On-line Mortgage Lender of 2025 by Bankrate
Tomo Exists As a result of Shopping for a Dwelling Can Be Horrible
Tomo Mortgage was created as a result of buying a property could be a actual ache within the neck, and as an alternative of counting on previous applied sciences, they’re going the digital route.
This implies you may get began proper from their web site in minutes, whether or not by desktop pc or smartphone.
They’re additionally streamlining the method, simplifying how one can full duties, and throwing in a bunch of ensures alongside the best way.
All of it begins with a mortgage pre-approval, which they break down into two choices: verified and an underwritten pre-approval.
The verified pre-approval assesses your credit score rating, earnings, and debt, and turns across the paperwork in not more than three hours after they obtain your data, with no onerous pull.
The extra strong underwritten pre-approval does all that with a tough credit score examine and an entire evaluation by an underwriter.
The second choice takes about 24 hours to finish, when you’ve uploaded all of your essential paperwork.
Tomo commits to closing on time, and are assured they’ll accomplish that by shifting vital steps earlier within the course of.
The Tomo Mortgage Value Match
Whereas all that sounds good, there’s much more to love about Tomo in the case of their pricing.
For one, they don’t cost lender charges, much like corporations like Higher Mortgage, Filo Mortgage, and PenFed Mortgage.
So that you gained’t have to fret about any junk charges like a mortgage utility price, or underwriting and processing charges.
On high of that, they provide the Tomo Value Match in case you occur to discover a higher mortgage charge elsewhere.
Simply present a legitimate, comparable Mortgage Estimate (LE) dated inside one enterprise day of submission to Tomo and so they’ll decrease their charge if want be to match it.
However they’re assured they’ll provide a few of the lowest charges round as a result of they’ve simplified the house mortgage course of and made it extra cost-efficient.
Tomo Brokerage Companion Agent
Talking of pricing, to sweeten the deal much more, they’ll throw in a .125% (eighth) low cost in mortgage charge in case you use a Tomo Brokerage Companion Agent.
That is primarily their actual property referral community that pairs you with a neighborhood actual property agent, which makes plenty of sense as a result of each Schwartz and Armstrong labored on Zillow’s Premier Agent product beforehand.
In reality, Tomo may be much more much like Redfin Mortgage, which doesn’t cost charges and has an apparent actual property agent affiliation.
It additionally performs into the pattern of controlling extra of the house shopping for course of as an alternative of simply the lending piece, or merely the agent portion.
Assuming you don’t have already got an actual property agent, you can avoid wasting cash by going with one in all their suggestions.
This is named “Tomo Perks,” and on a $300,000 mortgage quantity might prevent greater than $7,000 over the lifetime of the mortgage.
To get paired up, you merely present your data to Tomo and so they’ll ship video profiles for 3 native actual property specialists they love. Then it’s as much as you who to select, if any of them.
For the file, it’s doable to benefit from each the Tomo Value Match and Tomo Perks.
The place Is Tomo Mortgage Out there? And What Mortgage Sorts Are Supplied?
- At present out there in 34 states and the District of Columbia
- Provide house buy loans solely (no refinance loans)
- Mounted-rate mortgages: 15- and 30-year mortgage phrases out there
- Adjustable-rate mortgages: 5, 7, and 10-year phrases out there
- Minimal mortgage quantity of $150,000 and min. credit score rating of 580 required
- Jumbo loans out there with mortgage quantities as much as $3 million
- Single household properties, townhomes, condos, and 2-4 unit properties acceptable
- Now gives FHA and VA loans too!
In the intervening time, the corporate is licensed in 34 states, together with Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Nebraska, New Jersey, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, Wyoming, and DC.
Tomo initially solely operated in three markets, Dallas-Fort Price, Houston, and Seattle, earlier than increasing quickly because of their massive enterprise cap backing.
In addition they solely provide house buy loans, as said above, although it’s doable they could develop into mortgage refinances sooner or later.
By way of mortgage selection, you may get a standard mortgage beginning with mortgage quantities of $150,000, or a jumbo mortgage as much as $3 million.
You can too get your arms on an FHA or VA mortgage, the latter permitting for zero down fee.
A minimal 580 credit score rating is required, and so they provide each 15- and 30-year mounted mortgages, together with adjustable-rate mortgages together with a 5, 7, and 10-year choice.
Whereas it looks like a restricted product menu, one thing like 90% of house consumers go along with the 30-year mounted, and most house loans are typical.
As well as, they provide down fee help to debtors in Connecticut, and hope to roll out related applications in different states over time.
Tomo Mortgage Charges
Maybe their largest declare to fame is their mortgage charges. They’ve acquired their mortgage charges on full show on their web site, in order that they’re not hiding something.
Merely navigate to “Get a charge quote” and also you’ll have the ability to generate a charge quote in seconds by inputting foundation mortgage particulars, all with out having to login or share delicate data.
From there, it should will let you fine-tune the speed utilizing a slider to see what it will be in case you paid (low cost factors) or in case you elected to obtain a rebate (lender credit).
Tomo Mortgage additionally gives a free float-down choice if mortgage charges occur to go down after you lock in your mortgage charge.
They incur a price of 0.125% to execute a float down, in order that they’ll decrease your charge by the distinction.
For instance, if charges occur to fall by 0.25% from the time you lock, they’ll decrease your charge by 0.125%.
In the event that they go down by 0.375%, you’ll see your charge go down 0.25%.
For each further 0.125% market decline, they’ll decrease your charge one other 0.125%.
Simply observe that just one float down is permitted and it’s solely out there to debtors whose time limit is a minimum of seven days away.
Tomo Mortgage Appraisal Protection
One other potential perk to utilizing Tomo Mortgage is their so-called Tomo Mortgage Appraisal Protection.
Known as a first-of-its-kind protection, it protects house consumers within the occasion the house appraisal is available in low.
This could occur every now and then, particularly if the housing market is softening (which is arguably taking place in the meanwhile).
Usually, a low appraisal would require the house purchaser to carry more money to the closing desk to make sure the loan-to-value ratio (LTV) is similar and the mortgage charge doesn’t change. Or worse, the mortgage can’t be permitted.
With Tomo Mortgage Appraisal Protection, if the appraised worth occurs to fall brief, you might be assured to obtain the identical APR, cash-to-close, and month-to-month mortgage fee.
In an effort to qualify, it’s worthwhile to get pre-approved with Tomo and work with a Tomo Mortgage accomplice actual property agent who will confirm the property tackle earlier than you make a suggestion.
As well as, you’ll want a minimum of a ten% or greater down fee so there’s a buffer in place.
Tomo Mortgage Opinions
Whereas they’re nonetheless a comparatively younger firm, they do have an honest variety of buyer critiques.
At Zillow, they’ve a 4.86 out of a doable 5 from 78 critiques, and on Google they’ve a 4.5/5 from almost 400 buyer critiques.
Tomo Mortgage additionally has 4.8/5 score on Bankrate from almost 200 buyer critiques, together with a 94% suggest score.
What separates them from the pack is their promise of no lender charges and mortgage charges properly beneath the nationwide common.
In addition they provide a pair ensures, together with the worth match and appraisal assure, and boast an on-time closing charge of 98% versus the trade common of 40%.
Whereas it’s a crowded place, these perks mixed with their recent trendy look may be sufficient to assist them stand out.
In abstract, Tomo is one more mortgage/actual property startup trying to shake up the established order. They’re doing so by focusing solely on house buy loans.
Simply remember to examine their quote to different lenders to make sure they really are main the best way on pricing, as an alternative of merely taking their phrase for it!
Tomo Mortgage Professionals and Cons
The Good
- Provide a digital, principally paperless mortgage expertise
- Their mortgage pre-approval is totally underwritten
- Publicize their mortgage charges on-line (no login required)
- Say their mortgage charges are 0.5% beneath the typical and 1% beneath the large lenders
- Value match assure in case you occur to search out one thing higher
- Don’t cost ANY lender charges
- Dwelling appraisal assure
- Glorious buyer critiques
The Possibly Not
- Solely licensed in 34 states and D.C.
- Solely provide house buy loans (no refis)
- Restricted product menu (no seconds, USDA loans, house fairness loans/traces)
Earlier than creating this web site, I labored as an account government for a wholesale mortgage lender in Los Angeles. My hands-on expertise within the early 2000s impressed me to start writing about mortgages 19 years in the past to assist potential (and current) house consumers higher navigate the house mortgage course of. Observe me on X for decent takes.